Access to the NHS Pension Scheme May 2014 Introduction The - - PowerPoint PPT Presentation

Access to the NHS Pension Scheme

May 2014

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Introduction

• The Health & Social care Act 2012 signalled a sea-change in the

‘traditional model of clinical provision, from one provided by the NHS, to one performed by a range of providers from both the NHS and the Independent sector.

• NHS organisations are entitled and required to automatically enrol

into the NHSPS all eligible staff they recruit. Independent Providers(IPs) often find it prohibitively expensive to build pension benefits into their reward packages that are comparable to the

• NHSPS. This has created a recruitment barrier.
• Access to the NHSPS for IPs providing NHS services fulfills the

policy aims of the 2012 Act.

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Background to the reform

• The Department of Health launched a consultation on plans to

widen access to the NHSPS for non-NHS providers of NHS clinical

• services. In order to introduce these new pension access

arrangements, amendments needed to be made to the NHSPS Regulations.

• A consultation on the 'National Health Service Pension Scheme

(Amendment) Regulations 2014' commenced on 2 December 2013 and the Government response to that consultation was published

• n 10th March 2014.
• Government Regulations enabling the new access arrangements

came into force on the 1st April 2014.

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Wider Access to the NHSPS

• Wider access to the NHSPS builds on the HMT New Fair Deal policy

and covers terms of access for non-NHS organisations providing NHS Clinical Services (IPs)

• This supports the delivery of a fair playing field in pension provision by

allowing staff delivering NHS services employed by IPs to become members of the NHSPS

• This supports the continued viability of the NHSPS and allows IPs to
• ffer an incentive to staff in terms of recruitment and retention.

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Scope of Access

• Policy applies to:
• Non-NHS organisations providing NHS Clinical Services (Independent

Providers),

• where they are delivering services under an APMS contract
• or an NHS Standard Contract
• or a Local Authority contract relating to the improvement and protection of public health under

the 2006 Act

• This includes services procured under ‘Any Qualified Provider’ and

covers both clinical and non-clinical staff delivering that clinical service.

• IPs can choose from two levels of access or maintain the default

position where they comply with the new Fair Deal.

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Qualifying for Access

• Apply to Scheme Administrator for IP employing authority status
• Hold one or more NHS Standard or APMS contracts, or a public health

related Local Authority contract to provide NHS clinical services

• Follow requirements of the NHSPS as set out in the Employers Charter
• Comply with monitoring requirements

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Access to the NHSPS - Timing

• With effect from the 1st April 2014 an IP who holds any of the

contracts previously detailed, can apply to become an Employing Authority(EA).

• An application to become an EA cannot be applied for

retrospectively.

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Access to the NHSPS

• IPs can choose from the two levels of access detailed

below or choose to maintain the default position where they comply with the new Fair Deal only.

• This position applies to all contracts held by the
• rganisation so is an important board decision to

respond to the strategic organisational requirements

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Access to the NHSPS – Level 1 and 2

• Level 1: Access for existing members: IPs are required to auto-

enrol into the NHSPS :

• From the date of commencement as a NHSPS employing authority,

all existing eligible staff who were entitled to participate in the NHSPS at any time in the previous 12 months, and

• From the date of recruitment, all new eligible staff who were entitled

to participate in the NHSPS at any time in the 12 months before joining the IP. Staff should be ‘wholly or mainly’ engaged in NHS work to retain access

• Level 2: Access for all eligible staff: IPs are required to offer

access to all staff who are eligible to join the NHSPS and are ‘wholly or mainly’ engaged in NHS work.

Either (Option 1)

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Access to the NHSPS – Level 1 and 2

• Level 1- IP Access “closed” approval – this level of scheme access is
• ptional. In simple terms, an IP that has been approved by the Scheme

Administrator as a NHS employing authority can choose to routinely join in the NHS Scheme ALL their staff who have moved to their employment voluntarily and had, within the 12 months prior to joining the IP, been entitled to join the NHS Scheme

• Level 2 - IP Access “open” approval – this level of access is also
• ptional. An IP that has been approved by the Scheme Administrator as a

NHS employing authority can choose to routinely join in the NHS Scheme ALL their staff, whether or not they have previously been entitled to join the NHS scheme

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Or (Option 2)

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Managing Risk

In order to manage the potential risk to the NHS Pension Scheme and to protect the taxpayer HMT required a number of control mechanisms to apply including:

• NHS Standard Contract as the key basis for the arrangement
• Overall threshold for the pensionable pay at 75% of the contract

value

• The employer will use a “wholly or mainly” criteria of more than 50%,

for each employee. This may require the use of split contracts

• A final pensionable pay cap of CPI + 4.5% will be applied to

members from the 1995 scheme

• Interest will be charged to employers for late payment of pension

contributions

• Spot audit will be applied by NHS BSA

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IPs Responsibilities

• Complete an initial application/declaration form
• Notify NHS Pensions whenever NHS contracts start or

cease

• Maintain accurate pension records
• Identify staff who meet the more then 50% criteria and make

them aware of their pension rights

• Collect all relevant employee contributions and pay

employer contributions at the correct rate and forward these to NHS Pensions by 19th day of month end

• Inform NHS Pensions when a pensionable employee starts
• r leaves

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IP Responsibilities (continued)

• Provide the required information to NHS BSA and support

the review proces

• Give prior notice if they elect to cease to be an NHSPS

Employing Authority

• Give prior notice if they wish to change Scheme access level
• Stay within the 75% pensionable earnings ceiling on an

annual basis

• Comply with all pension legislation and the NHS Employers

Charter.

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Rate of Employer Contributions

• Rates for participating employers will be the same as for NHS

employers – currently 14%

• The Employer contribution rate is expected to be 14.3% from April

2015

• All employers are required to comply with any future changes in

rate, both for employer and employee contributions

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Further information and contact details

The NHSBSA website contains the following in respect of IP:- IP Guidance: http://www.nhsbsa.nhs.uk/Pensions/4328.aspx Contact Details:

Julie Badon (DH – Pensions Policy) Julie.badon@dh.gsi.gov.uk Imogen Briers ( DH – Pension Policy) Imogen.briers@dh.gsi.gov.uk NHS BSA nhsbsa.pensionsemployers@nhs.net